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When Are Appearances Deceiving? The Nature of the Beauty Premium

  • Deryugina, Tatyana

We design a laboratory experiment to illuminate the channels through which relatively more attractive individuals receive higher wages. Specifically, we are able to distinguish taste-based discrimination from rational statistical discrimination and biased beliefs. Using three realistic worker tasks to increase the external validity of our results, we find that the “beauty premium” is highly task-specific: while relatively more attractive workers receive higher wage bids in a bargaining task, there is no such premium in either an analytical task or a data entry task. The premium in the bargaining task is driven by biased beliefs about worker performance. We find that there is substantial learning after worker- specific performance information is revealed, highlighting the importance of accounting for longer-run interactions in studies of discrimination.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 53581.

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Date of creation: Aug 2013
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Handle: RePEc:pra:mprapa:53581
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  1. James Andreoni & Ragan Petrie, 2005. "Beauty, Gender and Stereotypes: Evidence from Laboratory Experiments," Experimental Economics Center Working Paper Series 2006-22, Experimental Economics Center, Andrew Young School of Policy Studies, Georgia State University.
  2. Naci Mocan & Erdal Tekin, 2010. "Ugly Criminals," The Review of Economics and Statistics, MIT Press, vol. 92(1), pages 15-30, February.
  3. Jeff E. Biddle & Daniel S. Hamermesh, 1995. "Beauty, Productivity and Discrimination: Lawyers' Looks and Lucre," NBER Working Papers 5366, National Bureau of Economic Research, Inc.
  4. Mariana Blanco & Dirk Engelmann & Alexander Koch & Hans-Theo Normann, 2010. "Belief elicitation in experiments: is there a hedging problem?," Experimental Economics, Springer, vol. 13(4), pages 412-438, December.
  5. Marco Castillo & Ragan Petrie & Máximo Torero & Lise Vesterlund, 2012. "Gender Differences in Bargaining Outcomes: A Field Experiment on Discrimination," NBER Working Papers 18093, National Bureau of Economic Research, Inc.
  6. DavidJ. Cooper & Hanming Fang, 2008. "Understanding Overbidding In Second Price Auctions: An Experimental Study," Economic Journal, Royal Economic Society, vol. 118(532), pages 1572-1595, October.
  7. Berggren, Niclas & Jordahl, Henrik & Poutvaara, Panu, 2010. "The looks of a winner: Beauty and electoral success," Munich Reprints in Economics 20267, University of Munich, Department of Economics.
  8. Daniel S. Hamermesh & Jeff E. Biddle, 1993. "Beauty and the Labor Market," NBER Working Papers 4518, National Bureau of Economic Research, Inc.
  9. Ayres, Ian & Siegelman, Peter, 1995. "Race and Gender Discrimination in Bargaining for a New Car," American Economic Review, American Economic Association, vol. 85(3), pages 304-21, June.
  10. Rosenblat, Tanya, 2008. "The Beauty Premium: Physical Attractiveness and Gender in Dictator Games," Staff General Research Papers 13001, Iowa State University, Department of Economics.
  11. Simon Gaechter & Elke Renner, 2010. "The effects of (incentivized) belief elicitation in public goods experiments," Discussion Papers 2010-12, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  12. Mobius, Markus & Rosenblat, Tanya, 2006. "Why Beauty Matters," Scholarly Articles 3043406, Harvard University Department of Economics.
  13. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  14. Jefferson Duarte & Stephan Siegel & Lance Young, 2012. "Trust and Credit: The Role of Appearance in Peer-to-peer Lending," Review of Financial Studies, Society for Financial Studies, vol. 25(8), pages 2455-2484.
  15. Berri, David J. & Simmons, Rob & Van Gilder, Jennifer & O'Neill, Lisle, 2011. "What does it mean to find the face of the franchise? Physical attractiveness and the evaluation of athletic performance," Economics Letters, Elsevier, vol. 111(3), pages 200-202, June.
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